Pricing
The listed price is undoubtedly the single most important element of a property listing. Pricing, specifically determining the value of our home and our listed price is indeed a vast but vital topic to cover. Ultimately, almost everything comes down to price, and so it’s crucial that we understand how to price our home appropriately if we are wanting to achieve the best price. And so, I have broken down the topic of pricing into the following key discussions below.
Bargaining Position
Want to achieve the very best price for our home? Then we need to keep our bargaining position in mind at all times. Here I discuss the importance of bargaining position in our efforts to achieve the best price.
Not Underpricing, Nor Overpricing
Before diving into the main discussions, I want to alleviate any concerns and offer peace of mind and assurance to you, the homeowner and seller, that this guide does not seek to underprice to sell our home for cheap or under the market value, but nor does it seek to overprice our home either.
Getting The Price Right The First Time Matters
There’s no doubt that many homeowners/sellers would want to sell their home for as much as possible. For some, it may be tempting to overprice their home to test the market. Here I discuss why it’s so crucial to get the price right the first time.
The Factors That Influence The Asking Price
Do you know what factors actually influence the asking price of a property? Here I discuss the factors that do and do not realistically influence the asking price.
Comparable Properties
By far the biggest piece of evidence that helps to determine the value of any property are comparable properties. Here I discuss the extent to which they can be used to value and price our home.
Saleable Pricing
In a tough and competitive property market, our home needs to present a strong value proposition in order to attract buyer interest and engagement, and ultimately the best offers. Here I discuss saleable pricing, including the critical importance of saleability, and how we can make our home more saleable than the competition.
The Value Of Our Home
The price of a property is closely connected to its value. Here I discuss and break down how we determine the value of our home, and what makes it more or less valuable than a comparable property.
The Meaning Of ‘Structural Or Major’
Understanding the meaning and extent of ‘structural or major’ is an important element for determining the value and price of our home. Here I discuss and break down its meaning.
The Foundation Of Price
Some may have a misconception as to what is the foundation of price. This misconception can lead some sellers to overprice their home, or at least price it uncompetitively, hindering their chances to achieve the best price. Here I discuss and break down who and what makes up the foundation of price.
The Three Types Of Price
Most, if not all pricing strategies are based around three broad types of price. Here I discuss what these types of price are and how they relate to each other.
The Time Value Of Our Home
In a tough and competitive property market, the amount of time a property sits on the market matters a great deal to its value, and the seller’s chances of achieving the best price! The time value of our home on the market is perhaps the single most important aspect of selling the home, yet is often an aspect that is underestimated and underappreciated. Here I take a deep dive into this important aspect, as I believe that any homeowner/seller listing their home on the market should be fully informed. As we will find out in this discussion, time is an ally of the buyer and an enemy of the seller!
The Cost Of Waiting For The Market
It is not uncommon for some sellers to overly ambitiously price their home and choose to stick with their asking price without wishing to reduce it at any time, believing that the ‘right’ buyer and offer will eventually appear. Here I discuss the very probable consequences of waiting for the market.
Social Proof Affirmation
Social proof affirmation can have a significant impact on the perceived value of our home, yet is an aspect that is often overlooked and underestimated. Here I discuss the crucial role that social proof affirmation plays on perceived value, both for and against us, and why we should make it work in our favour.
Seller Sentiment And Bias
Pricing our home based on or influenced by our own sentiment and bias can be difficult to resist. In a lot of cases, sellers do not realise that they are doing this. Plenty of properties that remain stagnant on the market can be attributed to a large degree to the sellers’ own sentiment and bias. Here I shed some light on seller sentiment and bias and why we should avoid it in favour of evidence based pricing.
Accessible Pricing
Although pricing our home at fair or market value is a reasonable pricing strategy, it isn’t necessarily the best strategy to achieve the best price. Here I discuss the reasons why it isn’t necessarily the best strategy, and why accessible pricing is a better pricing strategy to implement to achieve the best price.
Our Likely Buyer Pool And Buyer Enquiry Pricing
There will always be the right type of buyers, as well as the wrong type of buyers for our home. The right type of buyers, or more specifically, the most likely and promising buyers for our home, make up our likely buyer pool. Here I go into more detail about our likely buyer pool, as well as buyer enquiry pricing, and how we can use this pricing strategy to get the most buyer engagement from the pool.
Band Pricing
Band pricing is an effective pricing strategy that leading property portals themselves strongly recommend to make the best use of their platforms, yet is an often overlooked and underutilised strategy by many. Here I go into detail about band pricing and how we can use this pricing strategy to market our home with optimal and maximum exposure to buyers, especially those within our likely buyer pool.
Market Reposition (Price Reduction)
Despite our best efforts and depending on the market conditions, there may be occasions where a price reduction is indeed appropriate. But rather than view it as a price reduction per se, I personally prefer to view it as a market reposition. Here I discuss the difference between the two and when we should consider resorting to such an approach.
Price Reduction And Switching Agents
Is your home on the market receiving little or no buyer interest or offers? If so, a price reduction alone may not be enough. Here I quickly go over why you may need to effect a price reduction whilst also switching to a new agent.
Final Thoughts On Pricing
In this section, I would like to cap off my discussion on pricing with a few final thoughts.